Blueprint for Housing Finance Reform

This paper sets out proposed administrative actions to reform the housing finance system in the absence of legislation. The goal is to build upon the progress that has been made toward a safer and more effective housing finance system with Fannie Mae and Freddie Mac in conservatorship, while ensuring the continued operation of the system. Ultimately, Congress must act to create an explicit, paid-for government guarantee of qualified mortgage-backed securities (MBS) and to provide the housing finance regulator with the authority to charter new firms to compete with Fannie and Freddie. While the policy debate over legislation continues, administrative measures can advance the government-sponsored enterprises (GSEs) toward an end-state vision that ultimately requires legislative action to finalize.